Strategic Buyer

A type of buyer in an acquisition that has a specific reason for wanting to purchase the company. Strategic buyers look for companies that will create a synergy with their existing businesses.

Because strategic buyers may actually get more value out of an acquisition than the intrinsic value of the company being acquired, strategic buyers will usually be willing to pay a pmium price in order to have the deal go through.

Also known as synergistic buyers.

Taobiz explains Strategic Buyer

Strategic buyers can come in many forms. A strategic buyer could be a competitor or a company in the same industry that wants to move into a new region. Purchasing an existing company in a new region may be more cost effective than starting new operations themselves.

Another possibility could be a company in an unrelated business, seeing that the company being acquired has strengths that could help their existing business. An example of this is a food manufacturer acquiring a supply-chain management/logistics firm.